Between 2006 and 2020, the world is expected to reach a peak in oil production where world demand for oil resources will be greater than the world's available oil supplies. Learn about oil and natural gas depletion and what that means for the global economy and our way of life in the United States.

Wednesday, March 01, 2006

Kicking The Habit, All Over The World

A recent article in the Los Angeles Times pointed out a very important point. Even if the U.S. was able to kick it's oil addiction, China and India are poised to emerge as industrial oil guzzling powerhouse in future decades, and they will potentially be the next oil addicts. While I still think it's extremely important for the United States to take steps to curb our oil demand since we are currently the world's current largest consumer of fossil fuels, but I agree that we should start working with other nations to keep the same scenario from happening in other countries. But from my previous post on Sweden, you probably already know that I'm not holding my breath on signficant change coming from political leaders. I'm still betting on individuals and local communities in all countries to reduce the world's oil consumption.

And on a side note, I'm don't support the author's view that we shouldn't rock the boat that is "global stability." Countries have the right to contract deals that support their interests just as much the United States has to right to contract such deals. As long as there is globalism driven by capitalism, there will always be global inequality. And as long as there is inequality there will never be true "global stability."

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PRESIDENT BUSH was right to say that the United States is "addicted to oil" in his State of the Union address. For too long we have been consuming ever-greater quantities of the stuff without paying heed to the political, economic and environmental hazards involved. Bush also made some useful, if timid, suggestions on how to curb our insatiable thirst for oil. But he failed to address a critical aspect of the problem: Other countries, including China and India, are just as addicted to oil, and unless we strive to suppress their appetites along with our own, the problems we face will continue to multiply.

For decades, the United States has been the world's leading consumer of petroleum, devouring about one-fourth of the global supply daily. Although higher gasoline prices have weakened demand slightly, we are still expected to consume 27% more oil in 2025 than we do today, according to the latest Department of Energy projections. But an even greater increase in demand is expected from Asia. China's oil consumption is expected to rise by 97% between 2004 and 2025, and India's by 78%. The resulting demand crunch could easily overwhelm the global supply of petroleum.

In the U.S., oil demand is largely spurred by Americans' collective love affair with the automobile. We also own far more vehicles, on a per-capita basis, than any other large nation. But all indications are that Chinese and Indian consumers are beginning to emulate us: In 2001, 16 million Chinese owned private cars; by 2020, the number is expected to hit 130 million; India's ownership rate is expected to grow just as fast.

"In their quest for foreign sources of petroleum, China and India are buying up fields around the world and, in some cases, forging close ties with such states as Iran, Sudan, Uzbekistan and Venezuela, which are considered unfriendly or even hostile to the U.S."A more troubling aspect of the recent surge in overseas energy deals by China and India is their willingness to invest in countries that are pursuing policies that are harmful to global stability," Assistant Secretary of State E. Anthony Wayne told the Senate Foreign Relations Committee in July.

For example, "both Chinese and Indian firms have reportedly been involved in oil and gas-sector deals in Iran that raise concerns under U.S. law and policy." This is especially true when such investment is accompanied by arms and military technology, as has been the case with Chinese links to Iran and Sudan."